Across the table: First public Iran-US bilateral talks in nearly 30 years

Even as they struggle to find common ground on Iraq, are America and Iran locked in the escalating tensions of a new Cold War?

Many analysts saw their meeting in Baghdad on 28 May as a sign of a thaw.

The US ambassador to Iraq, Ryan Crocker, described his four hours of talks with his Iranian counterpart as "positive".

But look at the bigger picture and there are serious and growing tensions on several fronts.

Essentially, the Americans accuse Iran of trying to destabilise their military presence in Iraq - and Iranian officials accuse the Bush administration of trying to foment a "velvet revolution" in Iran.

Spies, sanctions and soft power

It is more than a war of words.

It is an arcane game of overt and covert activity, complex regional manoeuvring and trade-offs - and the occasional hint of gunboat diplomacy.

This week the head of Iranian counter-espionage described his officials' efforts to thwart spying networks they'd uncovered in seven of Iran's provinces.

In Washington as in Tehran, there are different centres of power pursuing their own hawkish or dovish agendas

The official, who by tradition is not named by the Iranian media, linked these networks to countries with troops in Iraq - in other words, the United States and Britain.

He implied they were playing on ethnic divisions in Iran, especially in sensitive border areas.

Such allegations are, by definition, hard to prove or disprove.

But what's clear is that American pressure on Iran is not confined to UN sanctions designed to dissuade it from the pursuit of nuclear weapons.

Other US pressures include:

the use of "soft power" (broadcasting, cultural exchange, the promotion of democracy and human rights) to try to influence Iranian public opinion

efforts to coax somewhat ambivalent Arab states to join an anti-Iranian regional alliance

the Seizure of Iranian officials who are, in American eyes, stirring up trouble in Iraq

according to report, the US has been conducting covert operations inside Iran

ABC News has reported that President Bush has authorised the CIA to carry out a series of covert measures to destabilise Iran.

These range from propaganda to the manipulation of Iranian currency and banking transactions.

Iran is resorting to various means of counter-pressure, including:

the arrest of Iranian-Americans it accuses of spying

strengthening ties with the Arab world by, for example, offering to restore diplomatic relations with Egypt

maintaining a drum-beat of rhetoric against the American presence in Iraq and the Gulf, plus - and this may be Tehran's strongest card - maintaining an intricate network of contacts in Iraq which could potentially be used to target US troops or US interests

So how can the apparent contradiction, between the "positive" diplomatic exchanges in Baghdad and the Cold War climate of bitterness overshadowing US-Iranian relations, be explained?

Engage - and contain

Part of the explanation may be that, in Washington as in Tehran, there are different centres of power pursuing their own hawkish or dovish agendas.

The US administration is clearly looking for a new mix of policies.

It is willing to negotiate, but only from a position of strength.

Conscious of its difficulties in Iraq, it recoils from the idea of approaching Iran as a supplicant.

The Americans are also aware that, in the Iranian case, their military options are unattractive.

The alternative, therefore, is a mix of critical engagement and robust containment.